THE entire staff of a luxury Merseyside car firm were laid off last night, while the new owner considers moving production to South Africa.

The dramatic development at Jensen Motors sparked outrage from both local politicians and union leaders, especially as the sports car firm has been given special grants to boost employment in the Speke/Garston development area.

Management at the company - which employs around 43 people - said it had decided to lay off its staff and effectively close down the plant while it carried out a "business review," which is expected to last between one and three weeks.

But, as the Daily Post exclusively revealed on Saturday, the new owner of Jensen Motors is considering closing the Speke Hall industrial estate factory and moving to South Africa or another cheap labour company.

In a short statement yesterday, Jensen Motors spokesman Norman Childs said: "The business review at Jensen is continuing, and as an interim measure we have decided to lay off the workforce from this afternoon until this review is complete."

He was unable to confirm whether or not the workforce would still be paid while they were not required to come to work but stressed that they had not been made redundant.

Last night's announcement was condemned by North West Euro MP Arlene McCarthy (Labour) and by TGWU deputy general secretary-elect Tony Woodley.

Ms McCarthy said: "Jensen is a vital component in our drive to build up our expertise in the car-building industry on Merseyside. Speke/Garston is a fantastic development site and the last thing we need is a company moving out."

Mr Woodley said he would be seeking urgent talks with both the owners and the local authorities in a bid to clarify the future of the company in the area.

"This firm has had British taxpayers' money to bring jobs to Merseyside and to stay there. It is unacceptable that they should now be seeking to cut and run," he said.

"Both the British Government and the local authority has got every entitlement to an explanation for what's going on."

Mr Woodley added that the T&G had unsuccessfully tried to represent the workforce when Jensen decided to set up on Merseyside, but was told there was no need for a union as the staff had shares in the company. Even before yesterday's announcement, workers at the factory were reeling from the news that production of the luxury S-V8 Roadster sports car could be moved abroad.

The prospect of the firm quitting Merseyside comes as a direct result of a deal that brings in new investment cash needed to secure the company's future.

Representatives of the new financial backers, the London-based MacDonald Partnership, visited the Speke Hall industrial estate factory on Friday to break the bad news about relocation to workers.

A move abroad would be a big blow to the local economy, as Jensen's original decision to set up on Merseyside was seen as a major coup.

The company was enticed to Speke with financial backing from Liverpool City Council and Merseyside Special Investment Fund, which both stumped up #250,000.

The sales push for the #40,000 twoseater roadsters was launched in a fanfare of publicity last year.